HomeMy WebLinkAboutA004 - Council Action Form dated February 23, 2021 ITEM # 32
DATE: 02-23-21
COUNCIL ACTION FORM
SUBJECT: IOWA REINVESTMENT DISTRICT PROGRAM PRE-APPLICATION
BACKGROUND:
In October, representatives from the Ames Economic Development Commission
informed City staff that the State Legislature had authorized an additional $100 million
for the Iowa Reinvestment District Program. City staff is familiar with this program since
back in 2014 the City was approached by a developer from Kansas City, Missouri to
consider utilizing this incentive program to help finance a Dinosaur Park along S.E. 16t"
Street as a regional attraction for the City.
The Reinvestment Program consists of a pre-application which must be filed between
February 22-25, 2021. Provisionally approved pre-applicants are invited to submit a final
application with updated design and financial plans before February 2022. In December
2020 the City Council directed staff to prepare a pre-application for this program
that focuses on Downtown and Lincoln Way projects, including a Downtown
Plaza, Indoor Aquatics Center, and private redevelopment projects. Given that that
application deadline is in late February, it was understood that the staff would have to
scramble to obtain the necessary information needed to include in an application.
THE IOWA REINVESTMENT DISTRICT PROGRAM:
The State's Reinvestment District Program is designed to assist communities in
developing transformative projects that will improve the quality of life, create, and
enhance unique opportunities, and substantially benefit the community, region, and
state. The program provides a pool of $100 million of new state hotel/motel tax and
sales tax revenues to be awarded in this round.
This incentive program is administered by the Iowa Economic Development Authority
(IEDA) and awards are based on a competitive process. The selection criteria include:
Component Potential Points
Project Uniqueness 25 Points
Economic Impact 25 Points
Project Feasibility 10 Points
Capital Investment 10 Points
Funding Leverage 10 Points
Non-Retail Focus 10 Points
Additional Factors
(Readiness for development, 10 Points
geographic diversity, and funding need
It should be understood that this incentive does not come in the from of an
upfront grant. Rather, only the state portion of the new hotel/motel (5%) and sales
1
(4%) taxes that are actually generated in a City Council-approved Reinvestment District
and Urban Renewal Area will be rebated each year over a twenty-year period to help
fund a project. Therefore, should the City be successful in receiving this incentive,
the City will have to issue General Obligation (G.O.) Bonds for the total amount
needed to fund the aquatics center, minus any donations received, with the
expectation that the annual principal and interest payments due for this bond
debt would be partially abated with the sales and hotel/motel tax revenues
rebated from the state.
An important factor in estimating the value of the Reinvestment District incentives is the
timing of improvements that start the 20-year clock for receiving the rebated taxes. This
date is known as the commencement date and is based upon the completion of the
project with the greatest capital investment, which at this time is estimated to be hotel in
the Mixed-Use development.
Rather than offer the Reinvestment District incentive revenue to the developer to
finance the construction of the mixed-use buildings north of Lincoln Way
between Clark Avenue and Kellogg Avenue, the City's goal in seeking
Reinvestment District revenue is to generate these state incentive funds to help
mitigate the property tax increase for the construction of a new indoor aquatics
center for the City.
PROPOSED REINVESTMENT DISTRICT BOUNDARIES:
The Reinvestment District Program requires that a proposed district not exceed 75
contiguous acres. Attachment 1 reflects the boundaries of the proposed district and
location of the five projects. By maximizing the size of the district, the City will be able to
capture any new state hotel/motel and sales tax revenues, up to the initial amount
awarded by IEDA from any new projects that are identified in the City application.
PROPOSED PROJECTS:
The five projects included in the City's pre-application are as follows:
1. Indoor Aquatics Center
This facility will consist of a 43,700 sq.ft., two story building located north of Lincoln Way
directly across from the Iowa Department of Transportation Headquarters. The
estimated cost of this new facility is $27,494,000. The facility will house a six-lane, 25-
yard lap pool, two slides, zero depth entry recreational pool with a play structure and
adjoining current channel, therapeutic pool, walking track, and multi-purpose room.
Approximately $515,666 in retail sales tax will be generated for the Reinvestment
District from activities at this site over the 20 year period. Staff believes this project
would not be completed any sooner than 2023. (Attachment 2)
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2. Downtown Plaza
The plaza will be located in the parking lot across from City Hall in the heart of
Downtown with amenities such as water features for the summer months, an ice-skating
feature for the winter months, sitting areas with benches and swings, kinetic
sculpture(s), decorative art wall, stage/shelter for small performances, and areas for
street vendors. The City held a community meeting in January to review the proposed
concept and solicit public feedback. The presentation and summary of public feedback
is on the Planning Division webpage for the Downtown Plaza project.
This project is included in the current Capital Improvements Plan with a budget of $2.7
million dollars, with an additional $1,000,000 available from General Fund savings in FY
2020/21 for a total of $3.7 million. Design can begin this year with construction in 2022.
The current estimated cost of this project is $4,200,000 based upon the final cost
estimated by our consultant, Confluence. The current estimate includes generous
placeholders for the refrigerated ice system, support building, public art, design fees,
and contingency. Staff believes during final design the final cost will be more in line with
the budgeted $3.7 million. Attachment 3
While no Reinvestment District Program revenue will be earmarked for the Plaza, the
investment in this project should generate greater evaluation points for this local
contribution.
3. Onondaga Development (Burnett and 5th)
The Nelson family plans to rehabilitate the existing building at the SE corner of 51h and
Burnett (330 5th Street). The City awarded fapade grants and the property owner was
awarded a State Challenge Grant. The substantial rehabilitation of this building allows
for the new businesses that occupy the renovated space to be revenue generating
establishments for the Reinvestment District.
No additional incentives or use of Reinvestment District funds are anticipated for this
project. The property owner has started rehabilitation work on the ground floor and
plans to pursue adding apartments above the existing commercial space as well. The
project is estimated to be completed in fall of 2021 or early 2022. Staff estimates
potentially $2,262,880 in rebated sales tax over 20 years from this project with the
building fully utilized as restaurant and retail space.
4. Lincoln Way Mixed-Use Development
This project would be the primary source of Reinvestment District tax revenue.
Although this site (Lincoln Way to Gilchrist Street from Clark Avenue to Kellogg Avenue)
has been discussed for redevelopment for a number of years, there is not a final
approved project for the site. The potential developer has been working with the
majority landowner in the area to prepare a concept for the site to include in the pre-
application (Attachment 4). The description of the project includes the following
components:
Full-Service Hotel - 136 rooms
Conference space within Hotel - 20,000 square feet
One Hotel Restaurant— 6,450 square feet
Two Restaurants - 6,470 square feet
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Retail/Restaurant -14,500 square feet
Apartments - 72 dwellings, principally 1 bedroom
Office - 84,000 square feet divided between two buildings
Parking - approximately 600 spaces
Due to the size of this project and issues related to hotel development during the Covid-
19 pandemic, the project will be built in phases. Staff has included development of office
space as the first phase occurring in 2023 with the hotel, restaurants, and retail uses
occurring in 2024. Staff estimates the hotel will generate $6,227,379 in hotel tax
revenue and the retail/restaurants will generate $9,058,423 in rebated sale tax through
the Reinvestment District. Note that these estimates assume collecting a full 20 years of
revenue from each project component. Depending on the commencement date of
the District and the phasing of the project, the City may not be able to collect the
full twenty years of state tax revenue.
The developer intends to propose the use of Tax Increment Financing (TIF) to help fund
the project. TIF would be based upon the incremental increase in taxable property value
created by the project and would be "rebated" back to the developer as defined in a
development agreement. The developer also is interested in discussing options for City
participation in owning/operating public parking facilities that would help support the
development. Due to the conceptual nature of the plans and discussion there are a
number of unknowns about the ultimate financing plan for the project and
agreement with the City on specific incentive and design issues.
It appears from the initial discussions that the developer is seeking
approximately $25 million from this TIF incentive. Although the City has not
agreed to an incentive package, for purposes of submitting the pre-application,
the City has included the maximum TIF request permitted under Urban Renewal
laws, 20 years at 100%.
Upon submittal of the pre-application the developer will continue to work with City staff
to refine a specific proposal for City Council review this Spring. In addition to the TIF
incentive, a major issue remains regarding the parking plan in terms of its
financing, location(s), and ownership. One of the options is to consider locating
some of the parking in a public garage north of the railroad tracks and connecting it to
the south with a pedestrian bridge compared to locating all of parking to the south.
Although this option creates an ideal linkage, it is a more expensive option.
5. Kellogg Hotel (East of Kellogg)
The properties on the east side of Kellogg Avenue from Lincoln Way to the railroad
tracks are under a single ownership. The property owner, who is different than the
Lincoln Way Mixed-Use developer, indicates that he believes redevelopment of this site
is viable upon the completion of the Lincoln Way project to the west. The project would
be a hotel of approximately 100 rooms with 14,000 square feet of ground floor retail.
Due to timing of this project being dependent on the completion of the hotel in the
Lincoln Way mixed-use development to the west, it is estimated to be built in 2029 and
contribute 15 years of tax revenue to the Reinvestment District at a value of $3,463,635.
(Attachment 5)
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FINANCIAL PROJECTIONS:
It is important to note that that in order to build the indoor aquatics center, the
City will need to issue General Obligation Bonds in an amount equal to the total
estimated cost of the aquatics center project minus the amount of cash that will
be injected into this project from the Winakor bequest and major donations
received before the facility opens. Provided below are the current estimates related
to financing the proposed new indoor aquatics center.
Estimated Aquatic Center Construction Budget Revenues Expenses
Aquatics Center Current Cost Estimate $27,494,000
City Funding —Winakor Bequest $2,000,000
Donation Goal * $8,000,000
Estimated G.O. Bond Proceeds Needed $17,494,000
TOTAL $27,494,000 $27,494,000
*Dan Culhane of the Ames Economic Development Commission has
volunteered to lead the effort to obtain donations for the Aquatics
Center. As indicated in his letter, to date he has secured a $3 million
commitment from Rich and Mary Fitch and he is optimistic he will
be able to secure the remaining $5 million of donations in time for
our final application with requests out to Story County, Mary
Greeley Medical Center, and other potential donors. (Attachment 6)
The proposed $17,494,000 G.O. bond debt is intended to be partially abated by
revenues from the Reinvestment District. Total debt service, assuming a 2% interest
rate for 20 year bonds with issuance costs and a repayment schedule structured to
more closely match available revenue, is estimated to total $21,920,746. The City
Council will have to make a final decision regarding a strategy for authorizing the
sale of these G.O. Bond funds at a later date. The table below outlines the potential
property tax impact from Reinvestment District revenue.
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Estimated Property Tax Assumes Assumes Assumes No
Obligation Consultant's More Reinvestment
Current Conservative District
Estimate For Estimate For Incentive
Reinvestment Reinvestment
Revenue Revenue
Estimated G.O. Bond Principle $17,494,000 $17,494,000 $17,494,000
Payments
Estimated G.O. Bond Interest $4,426,746 $4,426,746 $4,426,746
Payments
Less: Projected Reinvestment $21,527,983 $16,292,912 $0.00
District Revenue**
GAP: Estimated Amount Not $392,763 $5,627,834 $21,920,746
Abated From Reinvestment
District Revenue
**The projected revenue calculated by our consultants anticipates
$21,527,983 revenue from the Reinvestment District Program which
includes twenty years of revenue from the Lincoln Way Mixed-Use,
Aquatics Center, and Onondaga projects as well as fifteen years of
revenue from the Kellogg Hotel. The consultant also applied a 2%
inflation rate for all expected revenue. This is the amount that will be
included in the Reinvestment District application,
Staff believes a more conservative estimate of revenue would be to
remove the Kellogg Hotel project from the revenue estimates,
assume a 20% vacancy for the Mixed-Use project's retail square
footage, and assume no retail square footage in the Onondaga
project.
Therefore, it would be wise to include the consultant's projected
revenue total in the application to the Iowa Economic Development
Authority in order to maximize the pool of funding set aside for the
City of Ames. However, when informing the citizens about the
projected gap and the amount of State incentive funding that will be
realized to mitigate the tax increase associated with the debt on the
new aquatics center, a more conservative revenue projection should
be utilized.
**The projected full Reinvestment District proceeds are summarized below:
[ate gory SaiesVaiue Sales Tax Deposits
Lincoln Way Redevelopment Event s/Restau ran t/Reta.1 S22G,G0,583 $9,058,423
Linco=n way Redeyeia n ent Hoty-,/Mote 5124,547,574 $5,227,379
Onondaga Pmpextien.Re°stawant $56,571,997 $2,262,880
Indoorkquatic Center $12,631,559 5515,666
Kekogg,Hote=" $69,272,698 $3,463,635
Total lRAFund $489,744,511 $21,327,983
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FINANCIAL FEASIBILITY:
The pre-application requires the applicant to highlight the feasibility of each project by
showing the construction costs and revenue sources to fund the capital costs. Given
such a short period of time to discuss the mixed-use project with the developer, it is
difficult to show with any certainty how much will be paid for by the developer and how
much will come from a City incentive package.
The amounts shown in this pre-application reflect a maximum TIF incentive from
the City and the $18 million cost for the parking structure(s) and pedestrian
overpass paid for by the developer. It must be emphasized that these amounts
reflected in the pre-application do not bind either the City or developer at this
time. Subsequent negotiations will yield a final proposal that will be brought
before the City Council for approval, which must occur prior to submitting a final
application to the State.
ALTERNATIVES:
1) A. Authorize City staff to submit a pre-application to the Iowa Economic
Development Authority for the Reinvestment District Program with the
understanding that the assumptions, financial projections, and project elements
might change after the pre-application receives favorable review and more in-
depth negotiations with the developer occur, and
B. Direct staff to begin the required process of establishing an Urban Renewal
Area coterminous with the Reinvestment District Boundary.
2) Forego submitting a pre-application for the Reinvestment District Program this
year with the hope that this incentive will be available in the future and the
projections regarding the mixed-use development project elements and tax
revenues are more certain.
However, this year delay might result in the City losing the opportunity to capture
the tax rebates from the Lincoln Way Mixed-Use project should it be started
before a final application is approved by the IEDA. In addition, there is no
certainty that this incentive program will be available next year.
CITY MANAGER'S RECOMMENDED ACTION:
This has been a highly unusual endeavor since the staff has been working to
accomplish two tasks. The first is to create a mutually acceptable partnership with a
developer regarding the construction of a mixed-use project on the north side of Lincoln
Way from Clark Avenue to Kellogg Avenue. It is hoped that the addition of this major
project will serve as a catalyst to stimulate further redevelopment in accordance with the
City Council's Lincoln Way Corridor Plan.
Second, the City is attempting to take advantage of the Reinvestment District Program's
incentives generated from new retail and hotel/motel tax revenues collected from this
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mixed-use development to help fund an indoor aquatics center to replace the closing of
the Municipal Pool that will be demolished shortly to make way for the new Ames High
School.
While staff had hoped that the revenue generated from the five projects reflected
in our proposed Reinvestment District boundaries over the next twenty years
would cover the City's entire projected debt service for the indoor aquatics center
bond issue, it appears that this will not be the case. However, the ability to
access a substantial amount of non-property tax funding to help finance a new
indoor aquatics center should not be ignored at this time.
Therefore, it is the recommendation of the City Manager that the City Council support
Alternative #1, thereby authorizing City staff to submit a pre-application to the Iowa
Economic Development Authority for the Reinvestment District Program and directing
staff to begin the process of establishing an Urban Renewal Area coterminous with the
Reinvestment District boundary.
Please remember that the information provided in the pre-application regarding
the mixed-use development's square footage, uses, concept layout, incentives,
and projected state tax revenues to be rebated to the City for the aquatics center
will more likely than not be modified in the coming months should our pre-
application be selected by the IEDA to continue through the approval process.
Therefore, like the pre-application, the information reflected in this document
should be considered preliminary as well. There are many more discussions
needed with the developers to finalize their plans as well as our incentive
package. The City will have almost a year to modify the final application that is
acceptable to the City Council and meets the evaluation criteria of the program.
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Attachment 1
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9
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Ames Indoor Aquatics Center,Space Pro{barn Summary
15-Feb 21
Building Coostructloo 70 NO to Gro:-s R400
SPACE NEEDS for PROPOSED FACILTY PROGRAMS 2-Level Concept
D;,:,punt t)ly SF LA NO S; Gross SF Gross.wenslon AoatatkS(Zero.Lao.Slides,Unflu l 17.435
101 Natatodurn for 6+-l:ane Recreation Lap Pool&Wellness Pool 1 14,277 14,000 $ 7574,70
Recreation/Welioess pool(8'Wtde beck Area)
R6K'featipft1W271nP,S3 Pool(Water Arad)
current Channel and Ilea
Lap lanes and deck
Slides
102 Poni Equip/Chemieei 1 950 950 5 194,812
103 Wet Class 1 Party Room I Storage 1 en Ni 964 964 S 242,659
104 Aquatic mimctae Offce 1 193 19-3 S 48.582
i.o5 Lifeguard Oil 1 IA) 190 $ 47,827
106 Aquatic Swage 1 1,138 1,138 $ 286AS7
Lockers I=
107 Meec',General Locker Roam I 7.095 S 358"1"
108 Wnmeris Gw.rnrai locker Room 1 3,095 1,Dq,S $ 158,799
109 Universal Change ftoo'." 8 a sa Wo 800 S 248,248
110 Universal Lackeys 1 nx r_ 4W 4w > 107,632
Therapy Pool Jd3`7
III therapy Pool&.Deck(15r20 participants) 1 3,C27 3,027 $ 1,724,255
112 Pod islaip/clwmicai 1 5m, SIXI $ 102,533
Public Entry 1 Adminisvation 7"
Sol C+:rrt!rol(leak,F,:t,y,[x:x.xu... 5eessicx!J[dulP 1 144 144 $ t49,296
502 Admo,fleaibie suite I 1 tcu+ 200 200 5 49,259
511 WorkBreak Room 1 200 200 5 43,400
Recreation 14.,544
523 logPok/W,,koe,,track F 8,140 8,140 S 2,649,570
524 mo43 .Paiposersrom < 2,000 2,000 $ 444.850
$25 Multi-purpose average - 360 360 $ 71,870
Building Support 2.366
Slh Lounge,f(,ithcringJV<,!lding 1 800 80C1 S 337052
542 Genrrrai Storage 1 S16 816 S 18.1,499
543 Receiving area 1 300 330 S 66,728
544 Maintestame Office i Work Roam, 250 250 55,606
A,ea required for c fculation,mechAnical,toilet too n9 tan tof closets,175ysEeo,n,etc 5,938 S 1.932,819
Struot...to,future bert,lfdl R.if an514n
tIBAWIftAftliGros% 17,677,900
Site Co31Y
LYJlities 300,000
Site Grading $ loo,000
Perking 140 $ 420,(W
1sn+fsts!pe and Watks S 100S 0
5tormwate;DLCWntioa(onder parking) Cubic Feet 43,000 S 516,000
t)-I tion
B+31dings 40,690 S 284.760
Parkinii-d Walks 70,00b S 140,M)
AsbestoB Abatament(Por 001,rol",xdedl 40,G80 $
tend Acquisition $ 2.013t1,400
Soft Costs
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$ 3iX1,fX10
Design fees(7;"i+j and Expenses $ 1,480,199
Constructicn Tetiag $ 70,W(i
Survey 5 50,0(10
Soii Sorrgs S 70,ow
M'isc, S 200.000
Contingency(15%) 5 3.584.941
€kTAttMtnlE'X'Ci757`2R22 27,494,000
Afternates:
1 Use.1,,-ground sterol detention at SE com.,,,of cite_ (Uuduct3 350,000
2 ilverslxe node,parking datenpon to allow hltve 30,000 0 addition(15,000 Per Sour) (Add) $ 150,000
3 P+er%or under parking detention to allo,future 25,000 sf addition over the park,og area. (Add% S 20,000
4 To add Storx ate,Om-tion in the T4d+,u.for expansion,ow above ground for phase A (Add) $ 8511,tHt0
and assume funare 3Qo00 sf 1)V t1<f footprint)addition in SE:coroor.
5o k-So%of pa,k'ng to add undo;parking storage.
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14
Attachment 3-Plaza
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Probable Construction Cost Opinion
The amounts stated herein are our best estimate of probable construction costs based on current information.Because costs are influenced by market conditions.
changes in project scope,and other factors beyond our control,we cannot ensure that actual construction costs will equal this cost opinion.
Ames,Iowa
Site Plan
Site Work Qty Unit Unit Cost Item Total Remarks
Mobilization 1 LS $ 25,000.00 $ 25,000.00
Demo 1 LS $ 150,000.00 $ 150,000,00
Earthwork 1 LS $ 50,000,00 $ 50,000,00
Storm Water Allowance 1 LS $ 50,000.00 $ 50,000.00
Sewer and Water Allowance 1 LS 1$ 125,000,00 $ 125.000.00
Subtotal $aoo,000.00
Concrete Har scape ty Unit Unit Cost Item Tota Re'marks
Concrete Walk Paving 12,500 SF $ 6.00 $ 75,000.00
Decorative Concrete Paving 2,015 SF $ 12.00 $ 24,180.00 at activity plaza
Concrete paving-Heavy Duty 6,150 SF $ 7.00 $ 43,050,00 at food trucks
Concrete Paver Base(5") 5,300 SF $ 5.00 $ 26,500.00
Decorative Pavers 5,480 SF $ 26.00 $ 142,480.00
Subtotal $311,210.00
Lighting Qty Unit Unit Cost Item Total Remarks
Artistic Light Columns 7 EA $ 9,500.00 $ 66,500.00
Area Lighting Allowance 1 LS $ 110,000,00 $ 110,000,00
Subtotal $176,500.00
Amenities Qty Unit Unit Cost —Ft—em-7757 Remarks
Water Feature Allowance 1 LS $ 210,000,00 $ 210,000.00
Skate Ribbon Allowance 1 LS $ 650,000,00 $ 650,000.00
Support Building 1 LS $ 750,000.00 $ 750,000,00 1,500 SF fir?$500/SF`
Stage/Shade Structure 1 LS $ 35,000.00 $ 35,000.00
Bike Parking 20 EA $ 1,O0OA0 $ 20,000.00
Swing Benches 5 EA $ 12,500.00 $ 62,500.00
Site Furniture Allowance 1 LS $ 175,000.00 $ 175,000.00
North Lawn Sculptures 3 EA $ 15,000.00 $ 45,000.00
Sculpture/Kinetic Sculpture:Allowance 1 EA $ 250,000,00 $ 250,000.00
Wall Painting Commission 1 LS $ 30.000.00 $ 30,000.00
Wall Footing 68 LF $ 150.00 $ 10,200.00
Concrete Art Wall-2 sided finish 544 SF $ 100.00 $ 54,400.00
Subtotal $2,292,100.O0
u t tal $3,179,810.00
continued below...
17
Landscape Qty Unit Unit Cost Item Total Remarks
Lawn Area 7,023 SF $ 2.00 $ 14,050.00
Synthetic turf 800 SF $ 15.00 $ 12,000.00
Lawn Irrigation 7,025 SF $ 0.45 $ 3,161.25
Irrigation Equipment 1 LS $ 3.500.00 $ 3,500,00
Decorative Boulders 18 EA $ 600.00 $ 10,800.00
Planting Area 22,750 SF $ 7,00 $ 159,250.00
Shrub Plantings 300 EA $ 45,00 $ 13,500.00
Canopy Trees 35 EA $ 450.00 $ 15,750.00
Ornamental Trees 15 EA $ 350.00 $ 5,250.00
ubtota 237,261.25
Subtotal 1 1
Contingency(10%) $ 341,707.13
Permit&Submittal Fees" $ 10,850.00
Escalation for 2022/23(5%) $ 170,853.56
Design Fee(10%) $ 341.707.13
Schematic Design Estimated Total* . 8 ,1
'Comparable Support Buildings:Innis Grove:427 SF for 300k=$703/SF/JTC 1,993 SF for 1 Million=$502/SF
-Buildino Permit fee:$6.000+Plan Review Fee:54.200+Gradino Permit:S250+Site Development Review:$400
18
Attachment 4-Lincoln Way Mixed Use Project Concept
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Attachment 5-Kellogg Hotel
February 12, 2021
Mr. Steve Schainker, City Manager
City of Ames
515 Clark Ave.
Ames, IA 50010
RE: Northeast corner of Kellogg and Lincoln Way
Steve,
I write to express my intent to pursue a hotel developer to build a hotel on the property I own on
the northeast corner of Kellogg Avenue and Lincoln Way in downtown Ames. I own all of the
property that fronts Kellogg Avenue from Lincoln Way north to the City of Ames public parking
lot directly south of the railroad tracks. Attached you will find a map that outlines my properties.
I have had conversations with a variety of hotel investors who believe that this site would be a
logical location for a second downtown hotel and support the major redevelopment project being
proposed from Kellogg Avenue to Clark Avenue that fronts Lincoln Way. I believe that a hotel on
this site would be somewhat smaller than the full-service hotel being proposed for the larger
project directly to the west.
Based upon the conversations I have had with a prominent hotel owner here in Iowa I believe
the following data points would reflect the type of property the site would support.
Keys 90 to 100 rooms
Investment $225,000/room or$20,250,000 (90 rooms) to $22,500,000(100 rooms)
Daily Rate $125 to $145 per night
Occupancy 65-70% (likely higher post-pandemic)
Data provided comes from a hotelier with more than 75 hotels in their portfolio across the
Midwest and over 40 years of ownership experience in the hotel industry.
I hope this information is helpful as you formulate the plan for the Iowa Reinvestment proposal.
This is an exciting opportunity for downtown Ames. I look forward to discussing the
redevelopment of my property sometime soon for a hotel project that will support the
community. It is my desire to see this property develop soon with construction commencing in
late 2022 and being operational in the fall of 2024.
Sincerely,
21
Attachment 6-Donations
a Ames
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February 12, 2021
Mr. Steve Sehainker, City Manager
City of Ames
515 Clark Ave.
Ames, IA 50010
RE: Aquatic Center Fundraising
Steve,
The following is a summary of the external fundraising for the proposed aquatic center
in downtown Ames. Numerous calls and appointments have occurred in the last several
weeks and the project has been enthusiastically received by all that have been
approached.
As you might imagine the size and magnitude of the requests made for the project have
been met with mixed reviews. I purposely approached a number of those that
expressed either a commitment, or interest, in the previously proposed Healthy Life
Center. I also approached a number of major businesses in the community as well.
Here is what I have to date.
Rich & Mary Fitch were quick to say yes to the proposed project and have committed, in
writing, their desire to generously pledge $3 million to the aquatic center similar to their
previous pledge to the Healthy Life Center. Mary Greeley Medical Center has been
asked to support the project and has communicated that they are prepared to make a
significant investment decision on the project in the coming weeks. I have also
addressed the Story County Board of Supervisors seeking an investment of$1 million
and $50,000 per year for 25 years to support the operational side of the facility.
Similarly, they have indicated they will render a decision in the coming weeks as they
work through their budgeting process.
Couple the aforementioned with the $2 million Winakor estate gift the City of Ames
intends to put towards the project, plus other fundraising calls yet to be made, and I am
confident that the external/private fundraising will get to a level of$10 million.
22
e Arne
While I was not successful in securing a significant contribution from some of our major
industries, I did hear from many that they would be interested and willing to support
contributions that could support a segment of our population that may not be able to
afford admission and/or annual membership/passes to the facility once it is constructed.
I am committed to working on this phase of the project as well if this is desirable to the
City of Ames.
Clearly, my work is not complete but I am energized to forge ahead by those that have
expressed enthusiasm for the project. I will continue this effort to support this very
important asset that will so greatly enrich our fantastic community.
Sincerely,
Daniel A. Culhane, President&CEO
Ames Chamber of Commerce
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